In vertebrates, the telomere repeat containing long, non-coding RNA TERRA is prone to form RNA:DNA hybrids at telomeres. This results in the formation of R-loop structures, replication stress and telomere instability, but also contributes to alternative lengthening of telomeres (ALT). Here, we identify the TERRA binding proteins NONO and SFPQ as novel regulators of RNA:DNA hybrid related telomere instability. NONO and SFPQ locate at telomeres and have a common role in suppressing RNA:DNA hybrids and replication defects at telomeres. NONO and SFPQ act as heterodimers to suppress fragility and homologous recombination at telomeres, respectively. Combining increased telomere fragility with unleashing telomere recombination upon NONO/SFPQ loss of function causes massive recombination events, involving 35% of telomeres in ALT cells. Our data identify the RNA binding proteins SFPQ and NONO as novel regulators at telomeres that collaborate to ensure telomere integrity by suppressing telomere fragility and homologous recombination triggered by RNA:DNA hybrids.